With Hulu's Emmy win for 'The Handmaid's Tale,' a streaming underdog comes of age

By DAVID NG and RYAN FAUGHNDER
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Sep 19, 2017 at 2:00 PM

LOS ANGELES (TNS) — Not long ago, Hulu was known primarily as a streaming service for viewers who wanted to relive the glory days of “Seinfeld,” “The Golden Girls,” “South Park” and other TV favorites.

All that changed this year with “The Handmaid’s Tale,” Hulu’s feminist sci-fi series that became a national conversation starter and its biggest success to date. On Sunday, the series, based on the Margaret Atwood novel, took home five Emmy Awards — including the award for outstanding drama series — tying HBO's “Big Little Lies” for the most wins of the year.

“The Handmaid’s Tale” is the first streaming show to win the drama series award — a feat that neither Netflix nor Amazon could accomplish — and signals Hulu's ascendance to the top ranks of TV. At the same time, its victory represents a win for traditional media, since Hulu is a joint venture between 21st Century Fox, Walt Disney Co., NBCUniversal and Time Warner. “Handmaid’s” was produced by MGM Television, a division of the classic Hollywood studio.

With its big victory, Santa-Monica-based Hulu now looks as if it has finally come of age and is ready to go up against its larger streaming rivals in the fight to land coveted scripts and A-list talent.

“We are competing with them on a daily basis,” said Craig Erwich, senior vice president of content at Hulu. “It’s not that you’ve won an Emmy. It's that you’ve created a place where people can win Emmys _ that's how you compete ... When you're in line at Starbucks and people are talking about your show, you know you've succeeded.”

It has been a long and, at times, rocky journey for Hulu. The venture launched in 2008 with big ambitions to change the TV business by providing free online access to popular TV shows. It was viewed as a legal alternative to piracy, which had been eroding studio profits for years.

But there were struggles early on as investors clashed over strategy. At one point Hulu’s owners even contemplated selling off their stakes in the venture. In 2013 Fox, Disney and NBCUniversal opted to hold onto Hulu and instead agreed to invest $750 million into the service as consumers ditched cable and turned to streaming services — posing a threat to their business. Time Warner took a 10 percent stake in the company last year as the pace of cord-cutting accelerated.

A new leadership team led by Chief Executive Michael Hopkins, a longtime Fox distribution executive, helped turn things around. Erwich, previously of Fox Broadcasting and Warner Horizon, pushed to lure top Hollywood talent and ambitious original shows.

As the streaming industry becomes more cut-throat, companies such as Hulu are trying to win “by creating tent-pole originals,” said Peter Csathy, founder and chairman of consultancy Creatv Media.

“With the ever-increasing amount of spending by Netflix and Amazon, it's harder and harder to break through, and that's why a big win like this is a big deal for Hulu,” he said.

Hulu expects to spend about $2.5 billion on content this year, compared with Netflix’s projected $6 billion. But Hulu, which was valued at $5.8 billion as of last year, operates only in the U.S., while Netflix has a larger global reach. Netflix did walk away with 20 Emmys this year, though not the coveted prize for outstanding drama series.

Although its lineup is still small compared to Netflix, Hulu is beefing up its slate of original programs, including a range of comedies and dramas. Upcoming shows include “The Looming Tower,” a 9/11-themed dramatic series; “Castle Rock,” a horror series based on stories by Stephen King; and the superhero-themed “Marvel's Runaways.”

As part of its growth, Hulu recently lured Joel Stillerman from AMC Networks — where he headed original programming and oversaw shows such as “The Walking Dead” and “Better Call Saul” — to the role of chief content officer.

Hulu currently partners with other studios for its original shows. MGM, for example, owned the rights to “The Handmaid's Tale” and had shopped the idea around to other outlets with little luck. Showtime took the project on but eventually passed, and later FX showed interest.

Hulu, which was looking for a signature project, ultimately sealed the deal by offering a straight-to-series order if the producers could find the right screenwriter to adapt Atwood's dystopian novel. At the time, Hulu hadn't tackled many ambitious series other than the King adaptation “11.23.63.”

“Their willingness to take the time to tell a 10-hour movie and slow it down was key to the success of the series,” MGM Television executive Steve Stark said.

Being on a newer platform such as Hulu also allowed the show to make unconventional creative choices, such as having a budding director, Reed Morano, helm the first three episodes.

"I don't know if (other, more established networks) would have given us the ability to take a chance on an untested pilot director," Stark said.

They also launched an unconventional Emmy campaign, with women in the series’ signature red dresses appearing at events and in public places throughout L.A.

As Netflix moves to produce more of its original series in-house, Hulu said it remains open to the idea of self-producing but will make the decision on a show-by-show basis.

“What’s important to us is to get the best writers and the best visions and to support them,” Erwich said. “If producing our shows is a means to that end, then we’ll do that.”

Although the Emmy wins for “The Handmaid's Tale” are a significant achievement, Hulu still faces plenty of hurdles, industry experts said.

“It's not going to be a game-changer in the short term,” said Tom Nunan, a former studio and network president who now lectures at UCLA. “You need a dozen of those to really change your business model on a substantive basis. I don't think one show will be enough to send them into stratospheric heights of Netflix or HBO overnight. What's nice for Hulu is they're even being mentioned in the same sentence as Netflix and HBO.”

So far, Hulu's best-known originals, other than “The Handmaid's Tale,” include the latter-day seasons of “The Mindy Project” (which Fox had canceled before the show went the streaming route), and smaller comedies, including “Casual” and “Difficult People.”

Hulu doesn’t release subscriber figures but said in May that it counts more than 47 million unique viewers. Unlike Netflix and Amazon, the service offers an ad-supported service that costs less than its commercial-free subscription service.

Seeking to differentiate itself from the competition, Hulu recently entered the live TV market with a service that includes more than 50 channels, including live sports and news from its parent companies. The service, which debuted in May, makes Hulu stand out from Netflix, which doesn’t offer live TV. Amazon Prime will soon start livestreaming Thursday night NFL games this year.

Hulu said it so far has no immediate plans to produce original films, an area that both Netflix and Amazon have moved into aggressively, causing no small amount of hand-wringing among the major studios.

The streaming company has ordered a second season for "The Handmaid's Tale," which is expected to debut in 2018.

Meanwhile, spirits were high among Hulu's senior executives as they celebrated the Emmy wins.

“To make history with this powerful series — it's just really special,” Hopkins told The Times on Sunday as he made his way into a post-Emmys party in downtown L.A.

“We’ve had a lot of momentum in the last year,” he continued. “It’s a good market for us that what we’re doing is resonating with viewers and critics alike.”

On Monday, staff celebrated with champagne at Hulu's Santa Monica headquarters in the main gathering space known as “The Well,” and the party was broadcast via feed to other offices.